So – Who Wants to be a Millionaire?
Me! And just about everyone else as well! But is such a sum achievable? Most of us grow up believing that we are destined to lead an average (though perfectly pleasant) life with the corresponding average income. We live our lives believing that any great monetary height is insurmountable- unless we somehow manage to get on Love Island or host thousands of cat videos on YouTube. Whilst we’re told at school and home that we can do anything from an early age, we’re all more or less encouraged to follow similar, predetermined paths that dictate our financial destinies.
Whilst there’s nothing wrong with being average, it doesn’t mean your finances have to be. What if we told you that wealth isn’t always something that’s bestowed upon you, it’s something that can be earned – providing you take the right steps and make the right choices (preferably before you become too old and wizened), though it’s never too late to start. Whilst it may not happen overnight and it isn’t as easy as it’s often made out to be, it can happen. It’s not about how much money you have to start with, but what you do with it.
So what are the steps to financial freedom?
Setting financial goals is crucial, but before you can set any goals, you need to know where you currently are. This means you have to spend some time assessing your current financial health. Look through your savings, debts, and any investments you might have. Whilst assessing your financial status may feel stressful and not very exciting, gaining this knowledge will allow you to set realistic goals. Now you’ve done that, the easiest way to achieve your goals is by setting small, measurable and achievable targets. Perhaps they’re more incremental, maybe they’re more guidelines than anything else. All that really matters is that you have a vision and that you stick to it , however much you may be tempted to spend any extra cash on that over quoted smashed avocado on toast. Either way, visualising a realistic target makes your goals seem that little bit more tangible and achievable.
Increase your income
We may well be stating the obvious here but to start building up your savings your income needs to exceed your expenditure, which isn’t the easiest when the cost of living keeps crawling ever upwards. Over your working life your income should increase and, providing you display a modicum of common sense, there should be more money to put aside for that rainy day that your parents always warned you about all those years ago. So, if at all possible, it’s a great idea to explore investment opportunities and accelerate that rate of income so you have a nice “cashion” by the time you reach your later years.
Alternatively, if progressing your career doesn’t seem to be a viable reality yet, you could always consider taking on a second part-time job, explore a hobby that pays the bills (remember those cat videos mentioned earlier?) or simply cut down on your expenditure to offset any income shortfall.
Live to work don’t work to live
Work can be amazing if you really want it to be. It can broaden your horizons and be rewarding and fulfilling at the same time. It can take you forward in new and exciting ways, helping you mould yourself into who and where you want to be. Not only does it give you money to live, it shapes your most important life decisions: where you live, who your friends are and the time you spend with your family.
If you work full-time you probably spend around 40 hours a week at work, more than 10 hours preparing for and travelling to it, countless hours recovering from it…and weekends thinking about it. Yet the much-coined mantra of the working populace is: ‘I don’t live to work, I work to live’. Surely, in order to live life to the full, you must love your work too? You have to create some impact, be yourself and live up to your true potential. Otherwise it could be a huge waste of time and you may just be keeping a seat warm. If you lack motivation, direction or commitment, the chances of achieving financial independence are similar to those of winning the lottery.
Stick it out for the long-term
For most successful entrepreneurs the road to making their fortunes was a marathon not a sprint. If you’re investing your money (which if you’re not, you definitely should be) you need to be looking well into the future. Given the nature of investing, you aren’t guaranteed returns overnight. We believe that, ideally, you should plan to invest for at least 10 years. Over the long-term, share prices tend to reflect the underlying reality of companies and the returns they deliver to their shareholders.
But over shorter periods, equity markets are rarely smooth and can experience extreme turbulence brought on by catastrophic events or just plain old erratic investor behaviour. Equity markets can overreact to new developments with unpredictable, and sharp, falls and gains in share prices. Some investments may take a longer time to mature, especially if the asset is something dependent on set-terms or build phases. The returns from property development investing for example are not only dependent on the amount of time it takes to build the property but also the amount of units that are sold and the time it takes to sell them. So our advice would be to stick it out, you’ll be glad you did in the long run!
Learn from your mistakes and move on
Mistakes. They happen to the best of us. Even the most astute, analytical and thorough individuals make mistakes. It’s just a part of human nature – no one ever truly learns from someone else’s mistakes either, you have to really experience a mistake yourself to learn the proper lesson. Have you ever found yourself saying, “I’ll never do that again,” only to find yourself doing the exact same thing just a short time later? Yep, me too. It’s likely all of us have repeated some of our mistakes at one time or another.Whilst mistakes are often seen in a negative light, they help us to learn where we went wrong and give us the opportunity to put it right at a later time. Ever heard of the well-used phrase: “there is no success without failure”. Indeed some of the world’s biggest successes have numerous failures festooned through their past.
So, next time you feel like you are headed for a life of mediocrity, just take a step back and remember that you’re the one that’s in charge of your own fate. Regardless of what you’ve been told, if you have a hunger for success, you will find it, and those pesky mistakes will help you get there.